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tv   Closing Bell  CNBC  September 4, 2012 3:00pm-4:00pm EDT

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that's inflation. with some lucky ones receiving as much as $20 for one of their pearly whites? what are they, like -- >> where do they live in the northeast? >> gold fillings or something? >> are those the kids that get taken to private schools in manhattan by their drivers? "closing bell" is coming up next. hi, everybody. welcome to "the closing bell." i'm maria bartiromo. stocks are mixed today. don't let the numbers fool you. this market staging a pretty good turn-around in the last half hour. >> i'm bill griffeth. at one point the dow was down nearly 100 points on the open this morning as we kicked off september. right now, they are marching here as we head into the close. we're looking whereat we stand at the moment. the dow still negative of the three major averages. down 26 points. it has had quite a comeback in this last hour.
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still at 13,000. 13,063. the nasdaq is back in positive territory up 11 points at 3,078. apple one of the leaders as they announce a product announcement coming up for next week. and the s&p is up a fraction after having been sharply lower earlier. now at 1407. meantime, the democrats are kicking off their convention today as election day is a little over two months away. with that in mind, looking at how the markets have done between labor day and election day traditionally. in the months leading up to the re-election of president george w. bush in 2004 it was the best period for the markets among the three most recent election cycles. so as we kick off another cycle, should we expect the same thing? >> we're looking at it. let's get to "closing bell exchange." we have brian belske, alan nukman, chris costantinos and
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steve leasem steve li esman with us. >> there's a very good chance we give back a little bit of these summer gains that have surprised most investors, as most investors remember back in june, july, were so bearish. market ran in their faces a little bit. remember as bill said at the top of the broadcast, september traditionally is the worst month of the year. would not be surprised if we see some weakness. our call is for a rally before the election but some weakness first. >> and alan, we had a very good summer. very good august. every reason to believe we'd see a correction this month. so far, no deal. >> yeah, trying to predict a sum ear the september swoon, i think, is a little bit disingenuous here. the markets are strong, resilient. we held a 1395 level friday and the friday before. the s&p needs a little more of a pullback before it can move higher. technically set up to run, run, run. we don't get the next earnings cycle until october 9th. that's going to be the driver, i think, but what i find very
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interesting is the market this last leg up in the last two weeks, the stock market has held, even though the bond market head ralhas rallied. all that -- that supported if the stock market can hold ground when all that money is rushing into treasures, that's a positive sign. >> how do you want to invest with a bit of uncertainty going into the election. chris, how are you positioned? >> we're positioned with a little bit of dry powder still out there. i think we agree if we're wearing our traders hat, we agree with brian we get a better chance to buy. also agree that intermediate to long term we're constructive here. we still think valuations are reasonable. dividend growth has been a winning bet. we still think there's some life. particularly if you look at nontraditional dividend plays like parts of tech and health care. particularly pharma. there's some, i think you have to be very careful internationally, but certain contrarian ideas like southeast
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asia and jeermgermany we find interesting. >> some very important reports and meetings to occur over the next couple of weeks that could have a big impact on these markets. >> yeah, i think so. and all of it relative to the federal reserve and policy. i think there's a bit of push me, pull me you can see in the market. how weak is the economy right now? and whether or not the fed can and will offset that weakness. you saw the ism number down below 50. that's just contraction again in the manufacturing sector. still growth in the economy. as long as that number is above 42.6. it's still growth in the economy. and the question about the jobs number coming in, what number that would to be keep the fed from doing -- i think it's going to be well north of 200,000 with the decline in the unemployment rate. bill, and maria, the question w came up, will the fed act given at september before the election. i want to show you some data the fed has acted to cut rates. there's a couple of septembers where the fed acted when reagan
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was in office. a couple of septembers it raised rates with george h.w. bush and george w. bush. they cut rates in october. you remember what was happening then. the fed will act if it feels it's necessary. there wouldn't be a rate cut because there are no more rates to cut. i don't think the calendar date really matters much here. >> last time bernanke leaked that report to "the wall street journal" saying if things -- if things do not improve, we'll thereby with stimulus. how would you characterize the last month of data, steve, given the fact we have seen a bit better scenario in terms of this economy. would that stop the fed? >> it was a bit better, but you have to ask yourself, is it going to be substantially better? that was the characterization in the minutes. sustainable and substantial change in the data relative to the recovery. and those were the two words that matter. what are we talking about? sustained at 300,000 a month. i know the doves on the committee feel this economy
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could do without creating inflationary pressure. north of 3% or 4% gdp growth. those were the numbers that would get the fed's attention. if we're still on a 2%. even 2.5% growth track, even if we do 150, 200,000 jobs, those are not the kind of numbers that would dissuade the fed. >> we've gone this long without mentioning the ecb. mario drogbe working behind the scenes. how are you viewing all of that and its impact on the u.s. markets? >> there's been a concerted effort overseas to get some sort of a plan done. the more we see that we hear about and actually able to reach out and touch a definitive plan, the better. it's very good news that they have been working on a very consistent basis to get something done. the u.s. has benefitted to some degree that we saw in the second quarter earnings. volumes coming back to the u.s. i think that's a major, major trend over the next few years. >> all right. gentlemen, thank you all. brian, i'll see you later this hour, toward the closing bell
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when we get to the countdown. meantime, a big comeback for the markets to begin the month of september as we head toward the close here. the dow was down almost 100 points at one time today. now down just 27. >> we've got a lot more ahead on this special edition of a tuesday edition of "the closing bell." back in a moment. coming up -- the china symptom. as the world's fastest growing economy slows is it good or bad news for the u.s. markets? the answer may surprise you. plus, union gap. the afl-cio's richard trumpka joins maria. if they are investing their pensions with private equity funds. >> they are so greedy, they just keep going. they'd love to see, balma get in. they are dying to have obama get in, but they can't wait that extra 70 days. >> and is opec actually conspiring to prime more pain at
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the pump for americans? and is $5 per gallon gas now more of a reality? all that and a lot more today on "the closing bell." [ male announcer ] at scottrade, we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's another reason more investors are saying... [ ] i'm with scottrade.
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welcome back. forget all the talk about china eating our lunch. have you checked the stock market in china lately? it's at lows not seen since march 2009. two key economic reports showing china's manufacturing sector shrinking. at the fastest pace since the global financial crisis. as we bring this conversation home we're wondering whether chinay slowdown is good or bad for u.s. markets and corporations. global corporate strategist robert kuen says this will hurt the u.s. thank you both for joining us today. robert, make the case. how does this hurt. the china slowdown, how does it hurt the u.s. market? >> china and the u.s. co-vary together. as china prospers, america will
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prosper. that doesn't mean in individual sectors that's the case but overall. the american standard of living has been raised by cheap chinese imports at quality levels that no other country can match. that's why we have a severe trade imbalance. america has enjoyed that high standard of living. that's the case. but china's slowdown, it's important to recognize, is structurally a part of a restructuring that's needed in china. so the slowdown overall is not bad in the long term. it has to happen because of the structural problems of overinvestment in china, overreliance on trade and a microstructure that china has to readjust its corporate structure in order to pay workers higher salaries. it's a lot going on. >> i wonder what the issue is surrounding the fact that china has been the engine of economic growth for the world. a slowdown there has ramifications all over the world. ann you say china's slowdown is
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great for the u.s. because it allows the u.s. to manufacture products, take more of the manufacturing from china. do you think that's really going to happen? >> well, absolutely. because china's labor wages have been growing at double digits for the last few years. and its middle class is growing rapidly. it's going to make manufacturing in the u.s. more competitive. and that's what americans want is to have manufacturing come back to the u.s. and with china's growing middle class, their consumption is growing at double digits and their service sector is growing at double digits. and i would like to say that while manufacturing slowdown is true, that's not reflective of the developed economies in europe and the u.s. the service sector is more reflective of china's local economies. and the service pmi has been registering at 56 this past
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month in august and 55 in july. so it's growing consistently expanding. this means -- >> robert, let me -- >> manufacturing jobs are not coming back to the u.s. >> that's what i was going to ask you. that would suggest the slowdown is a longer term prospect. so, robert, let me ask you. the slowdown we're seeing in china is it cyclical, short-term, a more -- >> we're probably seeing some relationship to what's happening in europe and the u.s. longer term slowdown is absolutely essential for the restructuring of the economy. it has to move away from investment. it has to move towards the consumption. ann is right. the consumption sector needs to grow and is growing. the more china prospers, the more the u.s. prospers. to say manufacturing jobs in general are going to come back to the united states. most chinese products of low cost are going to go other places. they aren't coming back to the
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u.s. we have to recognize there's a dramatic ure ing in the world and everybody is part participating in it. >> we know the competitive situation always leans towards china because they've got much lower, you know, costs there. so companies are going to send workers to china and going to manufacture in china. what's great about china slowing down for the u.s.? >> i would agree with robert that, yes, there's a structural rebalancing going on. but this rebalancing is great because this enables for china's middle class to grow and create a service sector which can generate continued higher wages. that allows the private sectors in the developed economies to sell to china's middle class and not just depend on america's middle class. this way it gives a new engine of growth for nations around the world. and this is not priced into the markets. the markets have priced in the
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fact that china is slowing down but hasn't quite priced in the fact that china's service sector is on a rampage right now. >> services sector, important point to make. good conversation. we appreciate it. we will keep watching. want to talk about this treat everybody on wall street is talking about. >> we've seen this comeback in the market. may have a clue. >> they say that bill gross at pimco has tweeted. here's what bill gross just tweeted. draghi appears willing to write two to three year checks to peripherals. very reflationary. buy gold, tips, real assets. market comes all the way back from a 100 point slav. the ecb will announce a bond-buying program and it was leaked over the weekend that mario draghi was talking about buying european securities up to three-year duration at that point. that would be the extent they
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would buy and in fact, gold has gone higher today. so there's a reflationary trade that is going on today that seems to be reflected in bill gross' tweet today. >> yields in spain and italy have come down below that 7% mark. >> right. >> it will -- even around 6% or so. and if this bond-buying program does move the needle, in terms of keeping those rates in check, this could be a game changer. we've been here before and we're still waiting. >> arguably the most important event that will happen this week is on thursday with that moumt following the ecb meeting. brian schactman has a market flash for us right now. what's going on? >> take a look at shares of walmart. close to the highs of the session. they just came out and announced that it's amazing we're talking holiday shopping already. they are reducing their fees from layaways from $15 to $5. when customers speak, they listen. maybe it's because toys "r" us beat them to the punch. toys "r" us will have free layway going into the holidays. starting as early as today.
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the layaway wars. they got rid of layaway completely. walmart brought it back and now a battle, a price war when it comes to layaway. it's all about, in this sense, holiday toys. >> come on, brian. nice buzz kill there. we just got back from labor day. we're talking about holiday shopping. >> i'm a news man, maria. you have to start saving up. that's the way the calendar goes. >> thank you, brian. >> merry christmas, too, by the way. >> thank you. 40 minutes before the closing bell for the day. a market that's looking at light volume again. off the lows on the dow industrials. >> one stock at least going lower today. could it get any worse for facebook? it has. hitting another new low below $18 a share. might not stop there either. then you pay a lot more for it, but organic food may not be healthier for you. is organic just a marketing scam costing big bucks. >> is my daughter watching right now? >> we've got a food fight coming up. l lynch has been built.
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welcome back. the countdown officially on. apple hosting a big product event on september 12th. a week from tomorrow. jon fortt, will it be about the new iphone 5? >> i could try to hedge, but, yes, maria, it's got to be the
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iphone 5. you can tell by the little five shadow the 12 is casting in this invitation. important facts for investors to remember. two years ago apple sold more than 30 million iphones in the first two full quarters after the iphone 4 launch. most of those in the u.s. back then. many of those folks are up for grabs now that their contracts are up and carriers will want to sign them to new contracts. nokia, google, apple, everyone will be hunting those upgraders. by the way, 30 million iphones worth about $19 billion in revenue to apple, $10 billion to someone else on average selling prices. back to you. >> thank you. >> over to you, bill. >> thank you marx , maria. shares of the social network down another 2% today for another all-time low since it came public. let's all keep score here. the stock is down more than 50%. it's shed over $50 billion in market cap. i would commend our colleague
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andrew ross sorkin's column in "the new york times" this morning for more on that. let's talk about whether we're near a floor for this stock. i'm talking numbers today. on the technical side, richard ross. on the fundals side, lou kerner. and, lou, is there a bottom here somewhere? how did we get this story so wrong? >> it's hard to know where the bottom is in any stock. obviously, everybody knows the perfect storm that went on with mispricing, too many shares and then the nasdaq flub. we have a situation where three months ago, a lot of investors were looking at all the opportunities facebook had. everybody is looking at all the risk. most notably the risk as their user base shifts from desktop to mobile. >> right. >> but i'm still a big believer. >> i want to ask you about that first after we look at the chart. rich ross, different month but very same story here for this stock. how does this chart look here as it continues lower. >> that's true, bill.
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the seasons may change but the game remains the same. he name of the game is to continue to sell facebook. down 50% from the ipo. our work suggests another 50% down side from here. let's take a quick look at the chart. i'll show you how we get there. now that we've got almost three months of trading under our belt, traditional technical tools become more important. this yellow line coursing through the chart your 20-day moving average. of course in hindsight, needless to say, 42% as the nasdaq climbs over 6% during the same period. in august, we get a little reprieve here. stock tries to build a floor around psychological support at 19. that floor falls out. it becomes a trap door to lower prices. >> a trap door? i like that. >> you want to avoid the stock. sell the stock. the first time i would think about buying it is on a break back above that 20-day moving average. not a day before that happens. >> but you say, if i heard you correctly, you could see another 50% correction from here. it could go below $10? >> i think going from double
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digits to single digits is the kind of climactic event that could get a wash out in the stock and turn this around. don't buy this stock in here. >> lou, very quickly. would you buy it here? >> it's hard to know where the bottom is. we continue to think this is a once in a generation type of company that's going to be meaningfully higher in a year or two. >> gentlemen, thank you both. a story all of us will ton follow very closely, i'm sure. maria? >> that's amazing that -- amazing that you think the stock goes to $10 there or could at least. we'll keep watching that. meanwhile, the market coming back from the lows as we approach the close here. down about 26 points on the dow jones industrial average with about 35 minutes before the close. up next, he's the head of one of the nation's biggest labor unions. he's dead set against a mitt romney presidency. afl-cio president richard trumka will join me. protesters are out in force tonight in charlotte. the largest financial center
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welcome back. 30 minutes left in the trading session. if you are just joining us, we'll get you caught up on the market action today with the stat check. stocks staging a comeback from earlier lows following a tweet by bill gross suggesting that the ecb's bond-buying program expected on thursday could be reflationary. he's calling for a buying of hard assets right now. so the dow which was down about 100 points, as many as 114 here, coming back. we had disappointing manufacturing data out first thing this morning that pushed stocks lower. the fear indicator at its highest level in over a month with a gain of 2.4% right now. the last time the vix settled above 20, we're not there yet it
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was on yell 24th. we do seem to be trending in that direction. maria? >> bill, labor once again front and center this election. president obama was hot on the union trail yesterday rallying factory workers in toledo, ohio, before heading to this week's national convention. the democratic national convention. here's what he had to say. >> i stood with american workers. i stood with american manufacturing. i believed in you. i bet on you. i'll make that bet any day of the week. and because of that bet, three years later, that bet is paying off for america. >> joining me now in a first on cnbc interview, the man in charge of the afl-cio, richard trumka. also nice to have you on the program. welcome back. >> it's good to be back with you. >> what would a romney win mean to unions versus an obama victory. >> i was shocked when i saw their platform. it's the most anti-worker,
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anti-union platform of any major party in the history of the united states. it was a vicious attack on workers, and our unions. so i was shocked. what it would mean would be a great recession. a depression right now. because his policies are to go back to exactly what george bush did, to give more tax breaks to the rich, to deregulate wall street and everything else and hope things will find their way forward. >> actually, most people would say that 2013, we will see a recession because the president and congress have been unable to get together on this fiscal cliff. a lot of people are expecting if obama wins we'll have a recession in 2013. >> well, listen, when we took over, we were hemorrhaging 700,000 jobs a month under george bush. in the worst circumstances ever -- >> who is we? you mean the unions? who is we? the unions? >> the united states. the united states was hemorrhaging 700,000 jobs a month or 700,000 jobs a month
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under george bush. right now, we're creating jobs. we've created 3 million or 4 million jobs in the worst recession with an obstructionist congress working against the president. >> so you think that unions then are better off today than they were three years ago? >> i think america is better off. >> are the unions better off? are the unions better off? >> unions and america are better off. we're not hemorrhaging jobs. we're creating jobs. we have a guy that enforces health and safety laws. he wants to reinstill the buy in america labor. he's pushing for insource, not outsourcing. we have a president right now who is saying, let's bring jobs back to america and increase manufacturing. >> it's interesting because i am hearing a lot of that and yet we're just not seeing it in the numbers. an unemployment rate at 8.3% and most economists you speak to will tell you we should be a lot farther off in this moment in this recovery if you really want to look at a typical economic recovery. >> first of all, since the president bailed out the auto
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industry, which romney and ryan both opposed, we've hired 250,000 workers in the auto industry. that's very, very important for us. and if we didn't have any kind of help from the republican congress, we could have had a much better, more robust recovery. we never used to fight over transportation, over roads and bridges. these republicans in the congress right now in the house of representatives won't even give us a transportation bill to fix the roads and bridges that are falling down around us and making us less competitive as a nation. >> i'm really glad you said that that we are always fighting. i agree with you. if there's one thing out there i feel has really turned negative for this country is it's so divisive and divided. would you attribute that to class warfare and president obama's comments? >> well, i can tell you they've initiated class warfare a number of years ago. my class, the working class is actually losing. they've been after us for a number of years. if you look at the republican platform, that's the most class
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warfare platform we've ever seen in the history? >> really? how? >> it takes after workers and it takes after americans. it says do away with collective bargaining. do away with all the things that will help workers. voucherize social security, medicare and medicaid. all the things workers depend on, the country depends on. they want to do away with so they can give under ryan, $187,000 tax break to a millionaire in 2014. >> actually, i got to push back on that. i've got to push back on that because the tax increases that we're going to see as a result of the fiscal cliff are not millionaires. let's be clear. anybody making more than $200,000 will face the highest tax increase since world war ii. not millionaires and billionaires. we're talking $200,000 in incomes for an individual. >> the ryan budget in 2014 gives $187,000 tax breaks to millionaires. that's the ryan budget.
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if it goes forward. of course it won't because america wouldn't stand for it and he doesn't have the votes to do it. boo >> let me ask you about union membership because it has been dropping, falling to a 70-year low in 2011. some saying that over 100,000 members. what's going on? what do you think you'd like to see from the white house to stop the decline in union membership and why do you think it's dropping? >> we've been attacked by every corporation out there. we have the worst laws in the universe for industrialized countries. you don't have to believe me. just ask the ilo about that. but we've lost manufacturing jobs. we have a president, president obama, who wants to bring them back. he wants to stop outsourcing -- insourcing. he wants to bring jobs back to the united states. he wants to buy an america label to mean something again. that will put our members back to worth. when we start building again, we'll be able to put construction workers back to work.
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if we were building roads and bridges, we'd put millions of americans back to work and we'd all be better off. get those americans back to work, you don't have to worry about the deficit. will take care of itself. >> how do you fund that? with taxpayer dollars? it seems like the conversation of the day is focused on benefits and entitlements and whether or not this country can actually afford some of these benefits that, of course, the unions and so many workers have enjoyed for so many years. how do you want to fund everything you are talking about, through taxpayer dollars? >> we can't afford not to fix our bridges and railroads. we can't afford not to have a new grid system for the 21st century. we can't afford not to compete in -- >> so just take on more debt then? take on more debt above $15 trillion? >> no, let corporations pay a fair share. they are paying the lowest share since -- of gdp since the second world war. they've had record profits two years in a row. say are sitting on $2 trillion in profits and won't spend them
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to create jobs. the banks are sitting on money and won't spend it. tax them a little bit and make it be fair. let them have their fair share that the rest of us have already given. >> many people would say that the u.s. corporate tax rate is among the high nest the worest . >> the effective rate isn't. you know better than that. last year you had 25 corporations in the top 100 that didn't pay taxes. we wrote a check back to them. there isn't a single taxpay ear. >> now you are getting into tax reform. what you oar. >> you bet. >> in terms of companies not paying the tax rate you'd like to see them pay. it was all legal and it's the tax system that we have. the president himself has been talking about tax reform for the last three years but we haven't seen any change or dent in that process enabling feem pay lower tax rates. i'm going to move on to private equity talking about these tax rates. jim hoffa criticized mitt romney saying he represents everything that is wrong with our financial system. he made his money as ceo of bain
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capital by destroying u.s. businesses, sending good-paying american jobs overseas and filling his pockets with millions while putting workers out on the street. very similar to what you are saying today. do you think that's unfair, especially given the fact that the teamsters are making money off of private equity? the western conference of teamsters pension trust has $1.5 billion invested in private equity. how come you are investing in private equity? >> mitt romney got rich making america poor. he did everything that jimmy hoffa said. he loaded companies up, good solid companies with debt and then went to bankruptcy court and took away workers penceions there's two ways to succeed. there's the way that he did it, which is the wrong way and there's the right way where we work together -- >> you are saying things, but it's -- let me get your take on what's going to happen at the end of the year. we're going to go off the fiscal cliff because these guys can't make a decision on tax rates and spending programs. everyone is expecting when these
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spending program goes away, defense contractors are going to have to lay off, health care workers are going to have to lay off. transportation companies are going to have to lay off. how many layoffs are you expecting at afl-cio? >> i'm hoping we don't have any layoffs because the country doesn't need more laypauc dllay. we need them to work together. mitch mcconnell said his number one priority was to get rid of barack obama. not to create pensions or health care but to get rid of barack obama. we need to change that kind of attitude and put people back to work so that we can do what we do best and that's compete in a global economy and beat anybody who is out there. >> it does seem that the ryan/romney ticket puts the issues of the day front and center. i don't hear the president talking about a lot of these issues. i hear him asking for mitt romney's tax returns. i hear him talking about other things but not the issues of the day. job creation. >> you are a real big deficit
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hawk. i know that from watching your show. ryan's budget actually increases the deficit while it gives massive tax breaks to the rich. you think that's the way the country ought to be going. or we ought to be spending more on jobs. >> it's not what i think. what i think is what we've seen before is when government allows business to operate in a business environment where they are encouraged to create jobs. they do just that. and that's what i'm trying to figure out where the policy is that's actually going to create jobs for all of us. unions and nonunions. >> first of all, those corporations aren't going to build roads and bridges and grid system that we need. that's going to come from government action. that's how it's always come. and so they need to pay a little bit more. they've been getting by on the cheap. they sure have. and so have millionaires. and you said we have one of the highest tax rates. we have one of the lowest effective tax rates in the world. you know that. so if they pay a little more, we can actually get together, build these roads and bridges. that puts people back to work
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that pay taxes and they give, not take from the economy. that's what -- >> we certainly all want jobs back -- people back to work. richard, always great to have you on. thanks for your insights and this important conversation. >> thanks for having me on. i love being on this show. >> richard trumka, we love having you. see you soon. we are heading to the close with 20 minutes to go. the bill gross rally inback is starting to wear off right now. the dow down 47 points. the s&p back in negative territory again. >> is the market comeback a sign of volatility? more volatility to come and what's historically a bad month for stocks? also, after the bell, why is new york state investigating a private equity tax loophole now, even though the irs found nothing legally wrong with them five years ago? we're going to take a closer look at that. it's yet another attack on private equity when we come back. we're sitting on a bunch of shale gas.
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welcome back. we are entering the final stretch of trading here.
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we lawyer off the lows of the day. at the worst, the dow was down 114 points. even though we're down about 47 points, as history will show, this month actually is not very good to the bulls typically. according to s&p capital iq, september is the second worst month of the year for the s&p 500 with the index falling an average of 2%. >> is this a sign of what could be another volatile month for the stock market? with us, bob pisani. there's all kinds of rumors having to do with the ecb. the bill gross tweet showing support from mario draghi. everybody is focusing on -- >> everything points to one thing. the draghi put, bernanke put is still very much in -- some traders have themselves in a frenzy. they simply believe that something big is going to be coming from the ecb or the european union very, very soon.
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i think that's unlikely to see that right now but that's what's motivating the market and providing a floor. >> he said it, right. draghi said we'll be there regardless of what it takes. we'll be there to ensure the euro doesn't collapse. bernanke said it as well. we'll be there if the data doesn't improve. what do you think, larry? >> i think that's a big factor. i think draghi got a little more specific. at least that's what the news is. he addressed a closed door session of parliament and apparently made an impassioned argument that this isn't bailing out governments. that basically they've lost control of interest rates in europe because they can lower policy rates but rates keep going up in italy and spain. therefore, they oar should buy debt up to three years out. you've seen a huge steepening in the yield curves in these peripheral countries. >> that's going to disappoint the markets. they are expecting something bigger than buying short-term debt. the governments need longer term debt. a bigger program overall. i am -- i doubt that's moving the markets.
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that's going to satisfy them? you think so? >> first of all, i think it is likely the markets will be disappointed on thursday because i don't think the ecb will do anything until spain, for example, requests a package which allows the esm to start buying debt on the primary market. they'll not buy until the esm -- >> you could get a rate check on thursday but people's expecting as are so high now that would be disappointing. >> i think you'll see a rate cut on thursday. >> a rate cut. >> and rhetoric saying we are prepared to enter the market and buy debt. expectations have been ratcheted up it's probably not going to disappoint. >> mixed economic data out. the ism number showing manufacturing below the expansion level. more important to you, those auto sales figures were pretty good. >> i don't know if there's been much talk about the auto sales numbers. two reasons i like car sales. one, it's a real number. it's not a survey. they don't revise it except for
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seasonals. the second thing, it's a big ticket item. if people are buying cars even if they say they feel lousy, they must be feeling okay about the future to buy cars. car sales numbers do look pretty good. >> are you expecting the vibrancy to come back to this market any time soon? you have volume that remains pretty deadly here. back from the summer holiday and yet, same focus as before people went away. >> i look at it the other way. i think we've had a good sumner terms of the market. >> no doubt about it. >> and i think -- i don't know about the seasonals, september, i have to believe there can't be seasonals in markets. but we have had a very nice run. i think the better news on the u.s. is out already. we have a big report on friday, the jobs report. we'll see what that does. i think that's out. as bob was saying before, people are already excited about the ecb doing something. the markets haven't focused much on the election. you have to believe in the fall that's going to be a focus.
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there will be more nervousness around the fiscal cliff that with all the acrimony congress isn't going to do anything about. i think there's more down side than up side. >> september traditionally one of the worst months that's out there. yet all this old wives talk goes out the window. it all depends on the ecb and what the fed is doing. there's a lot of x factors floating around out there right now. but i think your point is right. autos and housing. the two biggest of the big ticket items are both showing signs of improvement. >> which is a real positive. >> thank you. we're in the final stretch of trading for the day. a market negative by 44 points. netflix has been battling an exodus of customers. now investors have another reason to worry about that company's future which we'll get to coming up. many consumers think organic food is healthier than nonorganic food and are willing to pay up as a result. a new study spoils that common belief. the startling details next. to ?
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certainly 2012 has been a year to forget for netflix. since late march, that stock has lost more than 50% and it's plunging again today down more than 6%. julia boorstin looks at what's behind this latest fallout for
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netflix. julia? >> well, bill, it comes with another company. the news starts with another company. news that amazon has struck a deal with cable channel epix to stream its movies. it's struck netflix very hard sending the stock down more than 10% earlier today, though it has recovered. the amazon's epix deal comes just a few days after netflix's deal expired. now they'll be available through both netflix and amazon streaming. today's deal is part of a bigger star. amazon is serious about making its streaming subscription a real rival to netflix. they are spending money to expand the instant video library. thousands of epix movies from paramount, lion's gate and igm are headed to amazon prime streaming bringing its total library to over 25,000 movies and tv shows. that's more than double the number of titles when it
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launched the kindle fire last september. now that netflix is truly facing off with deep-pocketed amazon, bill, we'll have to see what the company has in the works to help distinguish its service and hold on to its subscribers. back over to you. >> that will continue. julia boorstin in los angeles, thank you. we're coming back with the clothes countdown for this tuesday. then donald trump takes aim at opec. listen to this. >> opec can't wait. they are so greedy, they just keep going and they don't care. they'd love to see obama get in. they are dying to have obama get in but they can't wait that extra 70 days. >> is trump right? former shell oil president john huffmeiser weighs in and why he thinks you'll soon be shelling out $5 a gallon for gasoline. [ male announcer ] if you believe the mayan calendar,
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but say the sun rises on december 22nd, and you still need to retire. td ameritrade's investment consultants can help you build a plan that fits your life. we'll even throw in up to $600 when you open a new account or roll over an old 401(k). so who's in control now, mayans? okay. starting off the month of september. three minutes left in the trading session. let's do a quick recap of what happened today. two indicators we were watching closely this morning. the yields on the spanish bonds and on the italian bonds as they wait from some signal from the
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ecb. are they going to be buying bonds? of what maturity level is the big question. spanish ten-years coming down again. that's a good sign. italian ten years also coming lower today, down almost a full basis point, or ten basis points at 5.67%. and that brought the euro lower. that pushed our stock market lower. they didn't like the manufacturing data this morning. sort of ignored the good auto sales. the dow was down. then this tweet from bill gross or rumors about ecb intervention. something brought the market back and we're losing some of that gain, down 51 points. bill gross in his tweet supporting mario draghi. he said whatever they do is going to be reflationary so buy hard assets, including gold, and gold has gone higher today. a lot of commodities have done well today. up $10 on gold. it did touch $1700 an ounce for the first time in about six months today. i want to ask brian belski, would you buy gold here? are you looking at the
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possibility of inflation? >> no, gold's had a heck of a run. and fundamentally, we think it's a bit -- should it be part of a private client portfolio? sure. but gold has become a momentum play the last few years. we're just a little more worried on a longer term basis at these levels. >> meantime, matt, the markets wait on the ecb and the jobs number. a lot can happen this week. what your expecting? >> we talked about the ecb taking the forefront. i think the jobs number will be a bigger deal going forward for the end of the week here. we were looking for more volume today. didn't get it. people still in a wait and see attitude. be any number is going to generate headlines in this market and the market will move accordingly. >> jobs number, expecting a good one? >> no. i think moediocre. corporate america is freezing. they have no incentive to a


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